SECO TOOLS AB Year-end report 2010 and interim report for the fourth quarter
* Revenue for the fourth quarter rose by 35 per cent at fixed exchange rates, and by 28 per cent in SEK, and amounted to SEK 1,577 M (1,231). Operating profit was SEK 322 M (121), equal to an operating margin of 20.4 per cent (9.8).
* Revenue for the full year increased by 27 per cent at fixed exchange rates to SEK 5,858 M (4,889). Operating profit was SEK 1,098 M (307), equal to an operating margin of 18.7 per cent (6.3).
* Profit after tax for the full year was SEK 742 M (161). Earnings per share for the full year were SEK 5.10 (1.11).
* Strong cash flow from operating activities of SEK 1,252 M (861) for the full year.
* Acquisition of the American toolmaker Niagara Cutters completed.
* The Board proposes a dividend of SEK 4.20 per share (0).
* Lars Bergström is the new President and CEO as of 1 January 2011.
Comments from the CEO
“Demand continued to improve steadily in virtually all of Seco Tools’ markets during the quarter. As earlier, the strongest growth was seen in the emerging markets Asia and Eastern Europe.
Operating profit for the fourth quarter rose sharply over the previous year and reached SEK 322 M (121), equal a margin of 20.4 per cent (9.8). The improvement is mainly attributable to higher volumes. However, the stronger Swedish krona reduced earnings by 47 M for the quarter and SEK 149 M for the full year.
Cash flow from operating activities remained strong in the fourth quarter and amounted to SEK 1,252 M (861) for the full year. It has therefore been possible to further reduce the net debt/equity ratio, which was 0.42 (0.85) at the end of the year.
Our ongoing growth initiatives within the “Positioning for Growth” programme are now focused primarily on market penetration in growth regions and increased capacity for a solution-oriented approach, together with continuous upgrading of the product portfolio. Examples of the latter include new products in the drilling and end milling area for machining of composite materials.
We are pleased to announce Seco Tools’ acquisition of the American tool company Niagara Cutters during the fourth quarter. Niagara is a maker of solid carbide end mills and is one of the largest local manufacturers of these products in the USA. The end mill product area is regarded as strategically important, among other things for high-speed machining capacity and the ability to meet close tolerance requirements. The acquisition will strengthen Seco Tools' position and market share in this segment in general and in the important US market in particular, and will give the Group valuable experience in diamond coatings and micro-tools,” says Lars Bergström, President and CEO.
Fagersta, 1 February 2011
SECO TOOLS AB (publ)
THE BOARD OF DIRECTORS
The information contained herein is subject to the disclosure requirements of Seco Tools AB under the Swedish Securities Exchange and Clearing Operations Act and/or the Financial Instruments Trading Act. This information was submitted for publication on 2 February 2011, 7:45 a.m. CET.
For additional information contact Lars Bergström, President and CEO (Tel: +46 223-401 10), or Patrik Johnson, CFO (Tel: +46 223-401 20). E-mail can be sent to investor.relations@secotools.com
Previously published financial information can be found under “About Seco/Investor Relations” on the Seco Tools website (www.secotools.com). Seco Tools AB’s corporate registration number is 556071-1060 and the company’s address is Seco Tools AB, SE-737 82 Fagersta, Sweden. The telephone number to the Group head office is +46 223-400 00.